TPA Vs. In-House Claims - Which Is Better?
The claims of the majority of personal health insurance policies, especially in the private sector are managed internally because it is a core function. This gives the insurance company better control over efficiency as well as experience.
TPAs, on the other hand, can provide larger scale or efficiencies, as well as better negotiating power with hospitals, by consolidating claims across insurance companies.
So, there is no clear answer as to whether TPAs are good or the in-house claims department.
The claim service, whether it is outsourced or in-house, will depend on the quality of the team, processes, execution, and reporting. There are cases where TPAs with an excellent track record perform better than in-house claim departments, and vice-versa.
It is clearly visible when there is a difference in the quality of services provided by the same TPA - who performs well for a corporate policy from an insurer but performs very differently for a retail health insurance policy from another insurer.
Hence, before you go ahead, it is crucial that you learn about the service of the insurer or the insurer's TPA, whichever is the case. For this, you can go through reports published by IRDAI or the insurer on its own website. You can also learn from the experiences and reviews of others. So, ask around, check the reviews of past customers on the insurer’s website, etc.